How do I explain this regression result? It is based on mincer model, The depend
ID: 3254964 • Letter: H
Question
How do I explain this regression result? It is based on mincer model, The dependant variable is ln(Wage)
Coefficients
Standard Error
t Stat
P-value
Intercept
7.00
0.28
25.29
0.00
Male
0.26
0.07
3.62
0.00
Nationality
0.75
0.08
9.33
0.00
Education
0.09
0.02
5.46
0.00
Experience
0.05
0.01
5.44
0.00
Experience2
0.00
0.00
-3.77
0.00
Government Sector
-0.04
0.06
-0.66
0.51
City 1
0.79
0.10
8.06
0.00
City 2
0.49
0.08
5.94
0.00
Coefficients
Standard Error
t Stat
P-value
Intercept
7.00
0.28
25.29
0.00
Male
0.26
0.07
3.62
0.00
Nationality
0.75
0.08
9.33
0.00
Education
0.09
0.02
5.46
0.00
Experience
0.05
0.01
5.44
0.00
Experience2
0.00
0.00
-3.77
0.00
Government Sector
-0.04
0.06
-0.66
0.51
City 1
0.79
0.10
8.06
0.00
City 2
0.49
0.08
5.94
0.00
Explanation / Answer
Since the p-value for male, nationality, education, experence, experience2, city 1 and city 2 = 0 < 0.05,
So at 5% level of significance, we can conclude that these predictors have significant effect to predict ln (wage).
But for testing the significance of Government Sector,
we get p-value = 0.51 > 0.05,
So at 5% level of significance, we can conclude that the predictor government sector has no significant effect to predict ln (wage).
Hence, the predictor government sector can be omitted from the set of predictors.
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